Development projects under the first Malawi 2063 Implementation Plan (Mip-1) faced a K7 trillion financing gap in the first five years to 2025, available figures show.
The amount represents 54 percent of the total budget for Mip-1—a blueprint drawn as a segment of Malawi’s long-term growth agenda, and aimed at seeing the country becoming a lower middle-income economy by 2030.
The figures are contained in a budget analysis by the National Planning Commission (NPC)—a public entity mandated to draw and oversee implementation of Malawi’s long-term development plans— and the Economics Association of Malawi (Ecama).
According to the analysis, effects of the funding gap include weak efforts to establish a dynamic private sector that has also seen fluctuating funding levels, leaving bottlenecks that limit productivity.
However, the report has noted an improvement, a trend that started in 2024 with a narrowing funding gap.
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“In the 202627 financial year, budget allocations are projected to nearly match the estimated annual MIP-1 costing,” the report says.
According to the report, MIP-1 has not been adequately funded, with interventions that were originally scheduled for implementation in the early years not executed as planned and have since been deferred to later years.
While anchor firms required the most funding of approximately K1.42 trillion, they have been the most underfunded, getting only K3.2 billion, while creation of an enabling environment did not get any funding in the five years.
However, the analysis highlights overfunding in the other focus areas, notably for MSME development and legislation, which were funded beyond the MIP-1 requirement.
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Despite these funding issues to clear the ground for investment, the country has been struggling to attract investors, limiting growth through the private sector as envisioned in the MIP 1.
In an interview, Public Private Partnership Commission (PPPC) Chief Executive Officer Patrick Kabambe said the country needs to put more efforts in creating an enabling environment that unlocks Foreign Direct Investments, citing forex scarcity among serious hindrances to growth.
